The document discusses Jollibee's international expansion strategies. It started as an ice cream parlor in the Philippines and became the largest fast food chain in the country. In the 1990s, it began expanding internationally but faced challenges implementing Tony Kitchner's strategy of rapid expansion without proper research. By 1997, a new general manager, Noli Tingzon, was considering three options for growth: entering Papua New Guinea by partnering with a franchisee, opening a fourth store in Hong Kong, or supporting existing stores in California to expand to other markets in the US. The recommendation was to pursue the Papua New Guinea opportunity to gain a first-mover advantage with minimal risk.

1. INTERNATIONAL MARKETING
Jollibee Case Study

2. Kunal Shete - 92
Sameer Parab - 67
Karan Parmar - 69
Kartik Mehta – 50
Aditya Dhage - 11
Nilesh Singh - 97

3. JOLLIBEE FOODS CORPORATION

4. Started in 1975 as an ice cream parlor owned and run by the
Chinese-Filipino Tan family
Diversified in sandwich business after realizing 1977 oil crisis
could double the price of ice cream
JFC has a total of 2,510 stores worldwide
The Tans’ hamburger, developed by Tony’s chef father, quickly
becomes a customer favorite
Company's name based on TTC's vision of employees working
happily and efficiently
The “Five Fs” summed up Jollibee’s philosophy
Tan family members occupied several key positions
particularly in the vital operations functions

5. CONTD…
In 1993, Jollibee went public and in an initial public offering
raised 216 million pesos
The Tan family retained the majority ownership and controlled
Jollibee
Acquisition of Greenwich Pizza Corporation in 1994 and the
formation of a joint venture with Deli France in 1995
The company’s first serious challenge arose in 1981, when
McDonald’s entered the Philippines

6. ABOUT THE CASE

7. Moving offshore 1986-87
Early lessons learnt in Singapore, Taiwan
In 1993, TTC decided that Jollibee’s international operations required
greater structure and more resources
In January 1994, Tony Kitchner Vice President International
Operations
New Division was created having different identity
Kitchener's strategy adopted
Strained International-Domestic relations
Kitchner’s departure in 1997
New International Era 1997, appointing “Manolo P. (“Noli”) Tingzon”
Fresh look at the strategy

8. JOLLIBEE DOMINANT POSITION IN PHILLIPINES

9. Old establishment
Reason for entry into fast food business
A home-style Philippine recipe
The company's name
Keeping the employees happy & treating them with
respect
The “Five Fs”

10. CONTD….
A well developed operations management capability
A well oiled machinery that keeps close tabs on our
day-to-day operations
Professional outside managers to supplement
expertise in vital positions
Unique political situation
Subsequent growth in nationalism and local pride

11. REASONS FOR COMPETING SUCCESSFULLY WITH
McDonalds

12. Consumers preference towards Philippine
hamburger
Introduction a larger burger of its own, called the
“Champ”
Was able to turn the economic and political crisis in
1983 to its advantage
National Pride
Introduced new items in the menu all developed to
local customers taste

13. IS THIER ADVANTAGE SUSTAINABLE?

14. As long as below listed steps are followed advantage
should
be sustainable:-
Sustaining the first mover advantage
Retaining tight control over operations management
Allowing it to price below its competitor
Having the flexibility to cater to the tastes of its local
consumers
Constant market research in order to compete with the
multinationals

15. Tony Kitchner’s International Strategy
Evaluation

16. Build the global Jollibee brand
Positioning Jollibee as an attractive partner, while generating
resources for expansion
Top 10 fast food brands in the world
First mover into untapped markets
The company will be able to restrict the entry for competitors
Incur losses in the initial years

17. Targeting expats
Allowed the company to ease its transition into an unfamiliar
market
The popularity amongst expats could generate publicity and
attract walk-in traffic from non-Filipinos
The risk of targeting a narrow segment
Operations in Dubai, Kuwait & Dammam falied
The lifestyle, tastes and preferences of the expats was not
considered during international expansion

18. PLANT THE FLAG
(Rapid expansion strategy)
Reflected a desire to build an empire under his leadership
Failed to make financially sound decision for the firm
TTC preferred to go slower, making sure each
store was profitable / generate money for the franchisee
Neglected the large transaction costs associated with
establishing markets in new countries
Lack of research prior to entering in new market (The
unprofitable ventures in the Middle East)

19. Introduce dress code, converting the company image from
neighbourhood chain to world-class/multinational company
Assigned the responsibility of opening of new stores to a
Franchise Service Manager
FSM was also responsible to send the weekly data of store
sale to the company, helped monitoring the performance of
each of their stores.
Established a system to evaluated every aspect of operations
in detail, including product quality and preparation
Redesigned the new Jollibee logo & adjusted the menu to local
preferences

20. Kitchner never really understood the organizational culture at
Jollibee
Exhibited his personal culture throughout, the organizational
culture was forgotten
He replaced the friendliness, one of the pillars of the Jollibee
brand with competition, causing superiority complex
Failure to gain access to R&D and Finance resources
controlled by the Philippine operations

21. DECISION TO BE IMPLEMENTED

22. Noli Tingzon took on the role of General Manager of the
International Division in July 1997.
He was faced with three options for immediate growth
that would shape the company’s future international
strategy.
The options were:
Papua New Guinea: Raising the Standard,
Hong Kong: Expanding the Base, and
California: Supporting the Settlers.

23. Papua New Guinea
There was virtually no fast food or decent places to eat.
A poorly managed 3 store fast food chain had recently severed ties
with an Australian chicken franchise
The potential franchisee was willing to open five stores and would
even put up the capital.
The benefits of opening the stores in New Guinea are first-mover
advantage, franchisee would put up the capital, Jollibee would not
risk their equity, no competition, and putting fast food at service
stations would create a constant flow of customers
Our recommendation would be to enter into a franchise
agreement with Gil Salvosa, because the benefits outweigh the
risks.

24. Hong Kong
Many operating and cultural distance learning issues
Difficulty in retaining Chinese staff and appealing their product
offerings to locals
Experienced uneven product quality and weak brand recognition in
this market
Our recommendation would not be in favor of opening the fourth
store in Hong Kong because the risks of not being successful are
too great.
The decision to open a fourth store in Hong Kong may be revisited
at a later date.

25. California-Supporting the Settlers
Success in Guam led them to believe US had potential
Food Appealed to Filipinos and Americans
Plans to appeal to Asian Americans and then Hispanic
Americans
Competitive atmosphere of US fast food market will
provide Jollibee tremendous opportunity of global
learning
Helpful aspect is the diversification of America

26. IMPLEMENTING THE DECISION
New product-New market
Increase depots in the domestic and other countries
Maintaining market dominance
Focus on R&D from new markets, potential acquisitions and
new products to be developed
Aligning strategies with macro environmental changes
A geocentric approach
Management Development
Facilitate inter unit cooperation

27. Smooth supply chain management
Varying the menu to local taste
Develop understanding of the local market
Establish close relations with local marketing teams
Manage campaigns like an army operation – plan
ruthlessly
Track and adjust in real time